Mulberry Rejects Frasers’ £111 Million Takeover Bid as ‘Untenable’
Luxury handbag maker Mulberry has firmly rejected a revised £111 million offer from Frasers Group, led by Mike Ashley, calling it ‘untenable’. The London-listed fashion firm announced that instead of supporting the increased takeover bid, its board is committed to enhancing the commercial performance of the company. This decision aligns with the stance of Mulberry’s major shareholder, Challice – a group owned by Singaporean entrepreneur Christina Ong and her husband Ong Beng Seng, who have also declined the offer from Frasers Group.
In a statement, Mulberry expressed, “After careful consideration with its advisers, the board is unanimously of the view that the possible offer is untenable and that the company should focus its attention on driving the commercial performance of the business.” Frasers Group, which already holds a 37% stake in Mulberry, had raised the bid to 150p per share in its latest approach on October 11. This revised offer followed an initial bid of 130p per share, valuing Mulberry at £83 million, which was rejected earlier in the same month.
Frasers Group has been expanding its luxury portfolio in recent times, notably increasing its stake in Hugo Boss. However, the proposed takeover of Mulberry comes at a challenging time for the company, as its shares have experienced a significant decline amid global economic uncertainties impacting luxury consumer markets. Over the past year, Mulberry’s shares have plummeted by more than 30%, with a 22% decrease since the beginning of 2024, leading to a further 4% drop in Tuesday morning trading.
Under the rules of the City Takeover Panel, Frasers Group has until 5 pm on Monday, October 28, to either submit a formal bid or withdraw its offer. Despite rejecting the takeover bid, Mulberry sought to acknowledge Frasers Group’s support for the brand. The board stated, “The board acknowledges that Frasers, through its participation in the company’s recent fundraising, has shown itself to be supportive of maintaining the value of the Mulberry brand.”
Looking ahead, Mulberry expressed appreciation for this support and anticipates continued engagement with Frasers Group in the future. The dynamics between the two companies will be closely watched as the deadline for Frasers Group to make a definitive decision approaches.